HK to set up 300 mln HKD Pilot Green Transport Fund: financial chief

HONG KONG, Feb. 24 (Xinhua) -- Hong Kong's Financial Secretary John Tsang Wednesday proposed to set up a 300 million HK dollars Pilot Green Transport Fund for application by the industry, initially by the public transport operators.

Delivering the budget proposals for the fiscal year 2010-11 at a Legislative Council meeting, Tsang said the move was aimed to encourage the transport sector to test out green and low-carbon transport technology.

The use of low-emission and energy saving transport will not only help improve roadside air quality, but also reduce carbon emissions and promote a low-carbon economy, he said.

In 2007, the government launched a scheme to subsidize the replacement of the more polluting pre-Euro and Euro I diesel commercial vehicles with newer models producing fewer emissions. The scheme will end this March.

Tsang said, to continue to accelerate the phasing out of old diesel commercial vehicles, he will provide a 36-month subsidy scheme for the replacement of Euro II diesel commercial vehicles. The scheme will involve expenditure of about 540 million HK dollars.

He also proposed to accelerate the tax deduction for capital expenditure on environment-friendly vehicles. Enterprises can enjoy a 100 percent profits tax deduction in the first year under the proposal.

To improve the water quality of Victoria Harbor, we have already allocated 9.3 billion HK dollars for the construction of sewage tunnels and ancillary works of Harbor Area Treatment Scheme Stage 2A project.

The government have proposed to put in an additional 7.9 billion HK dollars for the remaining works of the project.

The government will allocate 5.1 billion HK dollars to build in Tuen Mun an incinerator employing the latest high temperature incineration technology to process sewage sludge generated from the project and others.

The water quality of Victoria Harbor will be greatly improved upon the completion of the project in 2014, Tsang said. (7.8 HK dollars = 1 U.S. dollar)